Large Communications Provider – Collateral Issues
A large communications provider was having ongoing concerns with its casualty insurance carrier regarding the calculation of program collateral requirements. The insured was aggravated with the lateness of calculations and the lack of detail provided by the carrier. The resulting uncertainty left the risk manager and treasurer with limited ability to plan and they felt handcuffed to the carrier. Additionally, the Insured’s independent actuarial study was provided to the carrier, but was never taken into account.
Old Republic Risk Management met with the broker and senior management of the Insured and agreed to consider the Independent Actuarial Report in determining the collateral requirements. The use of the independent actuarial report supplied the desired transparency for the insured and a better understanding of the total collateral needed to support the program.
In addition, Old Republic provided a transitional collateral requirement over a 3 year period. This allowed the insured to negotiate collateral decreases with their prior carrier as the collateral need ramped up for the new program.
This transitional collateral requirement and the use of an independent actuarial study provided the insured with the ability to plan and fully understand their obligations to post collateral to the casualty insurer. This is another example of how Old Republic Risk Management listened to its clients’ needs and put forth a solution that was amenable to both parties.
|
|
